Building Business Credit for Your Small Business

April 15, 2010 By Marco Carbajo

Building Business Credit

If you hope to qualify for financing for your business without having to use your personal credit then building a solid company foundation with positive business credit history is mandatory.

Here is a brief overview of the steps you will take to move you through the process and get your company on the path to obtaining the funding it needs based on its own creditworthiness.

Shelf Corporations

If you think purchasing shelf corporations will open up the credit floodgates for your company think again! These aged corporations provide the perception of years in business which is important in the eyes of lenders and customers. But there is a lot more to building corporate credit then age alone but if you do decide to purchase one make sure it’s reasonably priced and at least two years old with no liabilities attached.

Dun & Bradstreet

Once you have a corporation set up and completed all the necessary corporate conformity guidelines including but not limited to 411 listings, verifications and licenses you will be ready to register with Dun & Bradstreet.

Establish Business Credit

Once your registered you will need to establish business credit by first applying for vendor credit accounts with companies that report on a monthly basis. Once you get approved and start making purchases make sure to pay your invoices on time and monitor your files.

To get listed with Corporate Experian and Equifax Small Business you will need to establish accounts with companies that report to these specific bureaus.

Business Credit Cards

One of the ways you can start establishing business credit is through a secured card. This helps prevent your company from incurring any revolving debt so it’s a good place to start but as you continue building corporate credit you may soon qualify for no personal guarantee business credit cards.

If you must apply for business credit cards that requires your personal guarantee be sure that it reports your payment history to your business credit files and not your personal credit reports.

Small Business Loans

Obtaining small business loans can be difficult but it’s not impossible. It really depends on the level of bank credit that you have established. I would first focus on securing a business line of credit for your company so you can have the funds readily available when needed. This is much more convenient then having to apply for a loan every time your business needs the funds.

Business Credit Information

Finally you should stay plugged in and up to date with the latest news, resources and business credit information so your company can continue to expand its funding capabilities as well as leverage its diversity of credit.

Building business credit is not something you should spend your precious time or resources trying to figure out. It’s simply smart business to utilize a system that can take you through the process. With the right plan and execution of that plan you can expect your company to qualify for business financing without having to put your personal credit and personal assets at risk.

Looking to access a proven step by step business credit building system? A system that provides you access to premium vendors, business credit cards, funding sources and lenders that report to all the major business credit bureaus? Become a member of my Business Credit Insiders Circle. Submit your name and email below for details and receive a free audio seminar ($597 value) =>

Marco Carbajo is a business credit expert, author, speaker, and founder of the Business Credit Insiders Circle. A business credit builder membership helping business owners build business credit. He is a weekly columnist for Dun & Bradstreet Small Business Solutions, a business credit blogger for All Business & American Express Small Business and author of “Eight Steps to Ultimate Business Credit” and “How to Build Business Credit with No Personal Guarantee.” His articles and blogs have also been featured in Business Week, The Washington Post, The San Francisco Tribune, Scotsman Guide, Alltop, Entrepreneur Connect, and Active Rain.

Business Credit Builder: Dun & Bradstreet Product Review Part 2

February 1, 2010 By Marco Carbajo

Business Credit Builder

On the previous post I reviewed two business credit builder products at Dun & Bradstreet that were great for start-ups and companies that had a few trade experiences they wanted to add to their credit profile. In this post I’m going to cover two more advanced products that have received a makeover that’s definitely worth mentioning.

Now remember that obtaining a DUNs number does not cost anything to your company but receiving your number can take over 30 days if you choose the free route. However, you can obtain your DUNs number in less than 24 hours by either purchasing one of its business credit builder programs that I’ve reviewed or if you are a government contractor, government vendor, or grant recipient.

Let’s take a look at these business credit solutions and how they can help build company credit for your business.

DNBi Self Monitor Plus Inquiries

Price $799

This product is similar to the DNBi Self Monitor Basic except that it allows you to submit up to 24 references over a period of 3 months for a total of 12 payment experiences to be added. The basic version allows you only a total of 4 payment experiences to be added. They provide this extra cushion just in case they are unable to contact one of your references for payment experience verification.

In addition you have the ability to track the inquiries that others are making into your business credit file. This is a great way to make sure you are up to speed on the latest information that vendors, banks, suppliers and customers are seeing and an effective way to determine if your business is generating the positive interest it needs in the marketplace.

If you choose to purchase this product then most likely they will waive the DUNs File Creator fee so don’t hesitate to request it. This product is ideal for you if you already have existing trade references that you want to add plus closely monitor the activity and inquiries on your file.
Some other product features include:

• Key D&B scores & ratings including D&B Rating, Financial Stress Score, Commercial Credit Score and Supplier Evaluation Risk Rating.
• Comprehensive overview of payment history including D&B’s PAYDEX
• D&B’s Credit Limit Recommendation
• Financial performance including Key business ratios that measure financial strength.
• An overview of public filings including Suits, Liens, Judgments and UCC filings.
• Notification (alerts) when significant changes occur within your credit file.
• Easy-to-use web-based interface

* Tip – there are business credit builder companies like the Business Credit Insiders Circle that provide access to vendors, suppliers, business credit cards and companies that report to DNB for building small business credit.
DNBi Self Monitor Premium

Price $1,399

This product is the grand daddy of DNBs business credit solutions. In my opinion it’s a big upgrade to DNBi Self Monitor Plus Inquiries product because it allows you to submit up to 200 references over a period of 6 months for a total of 100 payment experiences to be added. The ‘Plus Inquiries’ version allows a total of 12 payment experiences to be added. That’s 88 additional references you can add with this product and 6 months time frame to do it.
Some of my members who have been in business for years and have just now realized they needed to build a business credit history found this product to be a no brainer. Since they already had long standing relationships with many companies they quickly had the ability to add dozens of trade experiences to their files and create a paydex score of 80+ in a matter of weeks!

*Tip – there are credit builder companies like BCIC that report your payments to a business credt bureau. Not only do they give you access to vendors, suppliers, business credit cards and companies that report to DNB but they also help you build business credit history too!

If you decide to purchase one of these DNB products or need some guidance regarding the status of your DNB report then call Dun & Bradstreet at 866-203-3151.

I hope that you found these product reviews to be helpful to you in getting started in building small business credit for your company.

To access business credit insider secrets, premium vendors, leasing companies, business credit cards, and lenders that report to all the major business credit bureaus become a member of my Business Credit Insider’s Circle. Submit your name and email below for details and receive a free audio seminar ($597 value) =>

sp_image-435950341-1242740704.pjpeg Marco Carbajo is a business credit specialist, author, speaker, and founder of the Business Credit Insider’s Circle. He is a business credit blogger for All Business & American Express Small Business and author of “Eight Steps to Ultimate Business Credit” and “How to Build Business Credit with No Personal Guarantee.” His articles and blogs have also been featured in Business Week, The Washington Post, The San Francisco Tribune, Scotsman Guide, Alltop, Entrepreneur Connect, and Active Rain.

Getting Business Credit Can Be Simple

January 21, 2010 By Marco Carbajo

Getting Business Credit

As small business owners recover from the recession it’s hard to imagine that getting business credit can be simple. However, the largest use of capital from business to business is the use of vendor credit lines which happens to be the single largest source of small business lending in America today according to the SBA.

So what is vendor credit?

Vendor credit is when a company, like an office equipment supplier, allows your business to purchase products and pay for them at a later date. Typically the terms range from Net 15, Net 30, Net 60, Net 90, or even Net 120 payment terms. These vendor credit lines work like a charge card meaning that the balance must be paid in full on or prior to the due date. Rather than struggle with getting business loans from financial institutions vendor credit also known as trade credit is an excellent option for new and existing businesses.

The primary benefit to getting business financing with vendor credit lines is that it will provide your business with thousands of dollars in products and services it needs up front while allowing your business to defer the payments for later. This helps you conserve cash flow for more critical short term expenses your business may have. The flexible payment terms also allows your business plenty of time to pay the invoice when it comes due.

A second benefit is vendors report your positive payment experience to the business credit bureaus. The more vendors you are getting corporate credit and payment experience with the stronger the profile you will build. This alone can positively impact the size of the credit limit recommendation for your business which is determined by dun & bradstreet and publicly disclosed on your file. As a result getting a business credit card without a personal guarantee can be much easier for your company to obtain.

However, one of the biggest mistakes made by small business owners is assuming that every vendor reports their payment history to the bureaus. Currently there are over 500,000 vendors who extend lines of credit to businesses but less than 6,000 report your payment experience.

So if getting corporate credit to build business credit history is a must be sure to select vendors that report. Be sure to also ask what agency they report to and how often they report. You can verify this by inquiring with a vendor that you plan to apply with. If this sounds like too much work then I suggest joining my Business Credit Insiders Circle and gain access to our premium vendors, credit sources, and much more.

One of my favorite aspects to getting a business line of credit with a vendor is the minimal qualifications required for approval. In many cases an application only requires your business contact information, Federal Tax ID#, Dun & Bradstreet#, authorized name and signature and not your social security number or personal guarantee.

The specific vendors requesting only this information will pull a business report to base their approval which makes building business credit with trade suppliers much easier and more convenient compared to credit cards or loans. A prime example of one of these types of vendors is a company called Quill.

Quill offers a net 30 account and reports to Dun and Bradstreet. Best of all they report your payment history every 30 days. For small orders you can get approved if your business has a listing on the 411 directories and a working website. New businesses can start out with smaller limits that will increase when you pay on time every month.

I also encourage every one of my client’s to join my Business Credit Insiders Circle. As a member they gain access to all the information, sources, videos, audios, and content not available to the general public. In addition each month we report their membership payments to Dun & Bradstreet!

As you can see getting business credit with vendor credit lines can be an ideal source to fund short term needs at the same time provide your business a way to build a strong file while avoiding the use of your personal credit and guarantee.

Marco Carbajo

Marco Carbajo is a business credit specialist, author, speaker, and founder of the Business Credit Insiders Circle. He is a weekly columnist for Dun & Bradstreet Small Business Solutions, a business credit blogger for All Business & American Express Small Business and author of “Eight Steps to Ultimate Business Credit” and “How to Build Business Credit with No Personal Guarantee.” His articles and blogs have also been featured in The Scotsman Guide, Alltop, Entrepreneur Connect, and Active Rain.